Biofuels Impact on Iowa Economy Still Strong

Cindy Zimmerman

A new study finds last year’s many challenges reduced the positive impact of biofuels on the Iowa economy, but the production of ethanol and biodiesel still accounts for nearly $4 billion in state GDP.

The study, authored by John Urbanchuk of ABF Economics and commissioned by the Iowa Renewable Fuels Association (IRFA), found the state biofuels industry also supports 37,000 direct and indirect jobs, and boosts Iowa household income by $1.8 billion. Overall, the impact of biofuels on Iowa’s economy was down 20-25 percent from 2019.

In 2020 Iowa biodiesel production increased slightly, but the COVID-19 pandemic, trade disputes, and Renewable Fuel Standard exemption abuse led to ethanol production decreasing by half a billion gallons compared to the previous year.

“Biofuels still provide a major boost to Iowa’s economy, but quite frankly, the report is a wake-up call to redouble our efforts at the state level,” said IRFA Executive Director Monte Shaw. “Midwestern states like Iowa must be aggressive to drive local demand for biofuels in a meaningful way, thereby providing a sturdy market foundation, even as we supply the rest of the United States and markets around the world. IRFA will continue to work with Gov. Kim Reynolds and the Iowa Legislature to improve our biofuels policies and programs.”

Biodiesel, biofuels, Ethanol, Ethanol News, Iowa RFA

Senators Ask EPA to Take Action on RFS Issues

Cindy Zimmerman

U.S. Senators Amy Klobuchar (D-MN) and Chuck Grassley (R-IA), along with more than a dozen others, sent a letter this week asking the Environmental Protection Agency to take immediate action on Renewable Fuel Standard (RFS) related issues. Those issues include reviewing small refinery waivers, issuing a proposed rule for the 2021 Renewable Volume Obligation, and advancing the proposed E15 streamlining proposal. The letter was sent to Acting Administrator of the Environmental Protection Agency (EPA) Jane Nishida and copied to administrator nominee Michael Regan.

Hours before the inauguration, former EPA Administrator Andrew Wheeler took action to exempt three unidentified oil refineries from their 2018 and 2019 RFS obligations under the Clean Air Act. These exemptions betrayed earlier assertions made by the Trump administration that the EPA would not grant or deny additional waivers pending the resolution of ongoing litigation over the use of the small refinery waiver authority. In January 2021, the U.S. Court of Appeals for the Tenth Circuit found that EPA had “grossly exceeded” its authority by granting certain small refinery exemptions. As this litigation continues, the Senators asked Acting Administrator Nishida to review the three waivers issued by Mr. Wheeler and, should they be deemed unacceptable, immediately reverse them.

“Fortunately, on January 21, 2021, the U.S. Court of Appeals for the D.C. Circuit…ordered an administrative stay of the three exemptions pending further order by the court. The order granting a stay…provides you a timely opportunity to carefully review the three midnight waivers and examine the previous administration’s flawed approach to adjudicating waiver petitions. We urge you to take advantage of this opportunity,” the Senators wrote.

Biodiesel, EPA, Ethanol, Ethanol News

Ethanol Exports were Bright Spot in 2020

Cindy Zimmerman

U.S. ethanol exports were the bright spot in an otherwise dark 2020 for the industry.

According to the Renewable Fuels Association, ethanol exports totaled 1.33 billion gallons in 2020, down 9 percent from 2019 and the lowest volume since 2016, according to official government statistics released today. Still, the annual volume was the fourth-highest on record and nearly one out of every 10 gallons of U.S. ethanol produced last year was exported.

“COVID-19 and protectionist trade barriers created enormous headwinds for ethanol in the international market in 2020,” said RFA President and CEO Geoff Cooper. “But the U.S. ethanol industry again rose to the challenge and supplied more than 1.3 billion gallons of clean, green renewable fuel to customers across the globe. American ethanol continues to play a crucial role in helping nations around the world reduce consumer fuel costs, cut harmful tailpipe pollution, and meet decarbonization commitments under the Paris climate agreement. We are especially encouraged to see that China finally re-entered the market in December, importing nearly 13 million gallons of U.S. ethanol. We enter 2021 on solid footing and the industry is optimistic about the prospects for meaningful growth in ethanol exports.”

Canada remained as the top market during 2020, receiving 326 million gallons, or almost one-quarter of the total. Shipments to Canada in 2020 were only 1.5 percent lower than the volumes exported there in 2019. Brazil received 200 million gallons of U.S. ethanol in 2020, down 40 percent from 2019 due to constant uncertainty surrounding import tariffs. India was the third-leading market, with 190 million gallons. While overall export volumes were down from 2019 levels, shipments to several key markets increased. India, the European Union, Mexico, and Nigeria all imported more U.S. ethanol in 2020 than in 2019.

The RFA will release its annual statistical reports detailing U.S. exports of ethanol and distillers grains next week.

Ethanol, Ethanol News, Exports, Renewable Fuels Association, RFA

AFBF Economist Sees Challenges for Ethanol Industry

Cindy Zimmerman

The ethanol industry is continuing to feel the impact of COVID-19 as the pandemic enters a second year of global disruption.

American Farm Bureau Federation chief economist John Newton, speaking Thursday at the virtual 57th annual Crop Insurance and Reinsurance Bureau Annual meeting, said ethanol production has taken a major hit in the last year. “From the beginning of 2020 through the last few weeks, we’re now two billion gallons less of ethanol production compared to prior year levels,” said Newton. “As of last week we probably still had 10 or 12 ethanol facilities around the country that are idle.”

Asked if the push for green energy under the Biden Administration might help ethanol, Newton said there will be challenges competing with electric vehicles. “We’re not going to go to electric vehicles overnight, so there’s a role for ethanol and biofuels to play there,” said Newton. “But, certainly on the long horizon I do see some challenges on the biofuels front.”

Listen to Newton’s comments here:
2021 CIRB presentation - John Newton, AFBF 3:28

2021 CIRB Annual Meeting Photo Album

AFBF, Audio, biofuels, Ethanol, Ethanol News

Senators Reintroduce Adopt GREET Act

Cindy Zimmerman

Sens. John Thune (R-SD) and Amy Klobuchar (D-MN) this week reintroduced the Adopt GREET Act which would require the Environmental Protection Agency (EPA) to update its greenhouse gas modeling for ethanol and biodiesel.

Specifically, the bill would require EPA to adopt the Argonne National Lab’s Greenhouse Gases, Regulated Emissions, and Energy Use in Transportation (GREET) Model for both fuels. EPA would then be required to update its modeling every five years or report to Congress to affirm its modeling is current or otherwise explain why no updates were made.

American Coalition for Ethanol (ACE) CEO Brian Jennings says the legislation would more accurately account for corn ethanol’s carbon intensity when establishing regulations which could impact ethanol use in the future. “The U.S. Department of Energy GREET model, which is widely-recognized as the gold standard tool for determining the lifecycle greenhouse gas emissions of transportation fuels, indicates that corn ethanol reduces greenhouse gases by 50 percent compared to gasoline,” said Jennings. “Unfortunately, EPA has disregarded this latest lifecycle science and continues to cling to a flawed and outdated model which shows corn ethanol is only 20 percent cleaner than gasoline.”

The Adopt GREET Act was cosponsored by Sens. Dick Durbin (D-IL), Joni Ernst (R-IA), Chuck Grassley (R-IA), and Mike Rounds (R-SD).

ACE, biofuels, Environment, Ethanol, Ethanol News

RFA’s Young Professionals Network Growing Fast

Cindy Zimmerman

The Renewable Fuels Association Young Professionals Network is only six months old, but it has already hit 100 members.

The YPN was formed last summer to bring together innovative and dedicated young professionals from across the country who are 39 years old and younger and employed full time by a company in the U.S. ethanol industry. Since its inception, the YPN has hosted multiple virtual networking events and learning opportunities, including a webinar last November that featured leaders from the fuel retail sector.

In addition to a full calendar of events, the YPN also gained a principal sponsor when Lallemand Biofuels & Distilled Spirits signed on to support the Network’s initiatives as part of their company’s mission to educate the next generation of ethanol industry leaders. Some of the members of the YPN have also formed a working group that is dedicated to assisting the industry in recruiting and retaining top-notch talent and plans to host projects that will provide resources to companies across the industry in assisting their employee recruitment efforts.

Those who wish to learn more about the Young Professionals Network can go to EthanolRFA.org/YPN for more information.

Listen to an interview with RFA’s Manager of Member Relations, Jackie Pohlman, who is leading the initiative.
Interview with Jackie Pohlman, RFA

Audio, Ethanol, Ethanol News, Renewable Fuels Association, RFA

EPA Administrator Nominee Says RFS is Priority

Cindy Zimmerman

The nominee for Administrator of the Environmental Protection Agency says the Renewable Fuel Standard (RFS) will be a priority for the new administration.

“You have my commitment that we will look at the RFS program and we will introduce some transparency into that program,” nominee Michael Regan said Wednesday at his confirmation hearing before the Senate Environment and Public Works Committee. “We will let science lead us and we will follow the letter of the law as it was intended for that program.”

Senators also asked about small refinery exemptions (SREs) and the Supreme Court case regarding those waivers and Regan said he will need to consult with staff and legal counsel, if he is confirmed, to see what actions the EPA will take.

Listen to Sens. Tammy Duckworth (D-IL) and Joni Ernst (R-IA) question Regan about biofuels issues.
Regan hearing - Sen. Duckworth 1:51

Regan hearing - Sen. Ernst 5:38

Audio, Biodiesel, biofuels, EPA, Ethanol, Ethanol News

SIRE Board Elects New Director Kevin Ross

Cindy Zimmerman

Kevin Ross speaks at SIRE during President Trump visit in June 2019

Southwest Iowa Renewable Energy (SIRE) has elected Kevin Ross as a member of the plant’s board of directors, effective last Friday.

Following the resignation of The Honorable Hubert M. Houser from the Board in December 2020, the Board’s Nominating Committee invited SIRE unit holders to suggest persons to fill Mr. Houser’s Board vacancy for the remainder of his term, through the 2022 annual meeting of the Company. Since that invitation, the Nominating Committee received a number of member suggestions, had discussions with a selection of the most qualified suggestions, and interviewed final candidates. Following the recommendation of the Nominating Committee, on January 29th, 2021 the Board appointed Kevin Ross to the Board vacancy to serve through the 2022 annual meeting of the Company.

Ross is a farmer from Minden, Iowa who currently serves as chairman of the National Corn Growers Association. Ross served for more than 16 years as a founding board member and executive committee member of Western Iowa Energy, LLC—a biodiesel plant in Wall Lake, Iowa.

Karol King, Chairman of SIRE’s Board of Directors said: “Kevin Ross has significant leadership experience in the ethanol, biodiesel and corn grower industries, and is an effective advocate for these industries at the state and federal level. His background will be very valuable to SIRE as we navigate challenging times for ethanol and rapidly evolving new technologies and markets for ethanol plant co-products.”

Biodiesel, biofuels, corn, Ethanol, Ethanol News

Vilsack Addresses Plans for Biofuels

Cindy Zimmerman

As Secretary of Agriculture during the entire Obama Administration, Tom Vilsack from Iowa was known to be a champion of biofuels. During his confirmation hearing before the Senate Agriculture Committee Tuesday, the former secretary pledged to continue his support of the industry – and make small refinery exemptions rare again.

“The waiver system was designed for small refineries that were having trouble, it was not designed for large scale refineries owned by Exxon and Chevron,” said Vilsack in response to a question from Sen. Amy Klobuchar (D-MN). “I would hope and will strongly urge EPA to go back to a day when those waivers are very, very infrequently granted.”

Vilsack hearing - biofuels (1:37)

Sen. Joni Ernst (R-IA) asked Vilsack how he will support biofuels in the White House when the Renewable Fuel Standard (RFS) is up for re-authorization in 2022 amidst a strong push for electric vehicles. “The reality is that we’re going to need both (biofuels and EV),” said Vilsack. “I don’t think I’m going to have to be too persuasive in that Oval Office to have the president, who committed to the RFS during the course of the campaign, to follow through on that.”

Vilsack hearing - EVs (3:05)

Biodiesel, biofuels, Ethanol, Ethanol News, USDA

U.S. Ethanol Wins Appeal in Peru Tariff Case

Cindy Zimmerman

The U.S. government has won an appeal on a countervailing duty case brought against U.S. ethanol in Peru, reversing a previous decision that applied a 15-cent per gallon duty and resulted in loss of market access in the country.

The Renewable Fuels Association, U.S. Grains Council and Growth Energy participated extensively in this case, arguing at hearings in both the initial investigation and the appeal in Peru on behalf of the U.S. ethanol industry. The following is a joint statement on the decision from Geoff Cooper, President and CEO, RFA; Ryan LeGrand, President and CEO, U.S. Grains Council; and Emily Skor, CEO, Growth Energy.

“We appreciate the thoroughness of the Competition Tribunal’s analysis, and the careful review process followed in Peru. This is a welcome development for our U.S. ethanol producers and our valued customers in Peru.

“We are pleased that Peruvian authorities reached the right result, and we look forward to continuing our close work with Peru to further enhance our mutually beneficial trade relationship development efforts, including urging them to increase their blend rate beyond 7.8 percent. Doing so would also help Peru to meet its Paris Agreement commitments and lead to opening more global trade of ethanol.

“The U.S. ethanol industry remains focused on expanding the global use of low-carbon ethanol, reducing barriers to trade, and elevating the energy discussion, and we favor continued collaboration and cooperation with Peru and other nations that share the vision of a free and open global ethanol market.”

Ethanol, Ethanol News, Exports, Renewable Fuels Association, RFA, Trade